India remains top offshoring destination for IT firms: report

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New Delhi: India remains the top offshoring destination for information technology (IT) companies, followed by China and Malaysia, said a study by A.T. Kearney on Monday. The study, Global Services Location Index, assessed 51 countries based on metrics under three categories including financial attractiveness, people skills and availability, and business environment. "Despite expectations regarding # 2 ranked China, India maintains and even increases its lead over China," the study said. "The country (India) is unrivaled in both scale and people skills." "Leading IT services firms are expanding their traditional offerings (in India) to include R&D (research and development), product development, and other niche services," it said. "The line between IT and BPO (business process outsourcing) is blurring as players offer bundles and specialized services to their clients and develop skills in niche domains." Although China offers an alternative to Eastern Europe for high-end IT and analytics, rising wages are limiting its cost competitiveness in lower-end functions compared with India and other Asian destinations. Asia continued to dominate the global market, with six of its countries among the index's top 10 offshore destinations. However, there are some challenges for the region. Global IT firms aggressively started outsourced back office operations in the mid-2000s, but today multinationals are reassessing their outsourcing strategies. There is a course correction where some functions are being repatriated from vendors back to the companies' own service centres and employees, the study found.


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India remains top offshoring destination for IT firms: report - Livemint

 

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Although China offers an alternative to Eastern Europe for high-end IT and analytics, rising wages are limiting its cost competitiveness in lower-end functions compared with India and other Asian destinations.